Cerberus Doesn't Want to Play Anymore, Wants Refund for Chrysler

By Ross Edwards
Wednesday, Dec 03 2008 11:07

Cerberus, the private equity firm that purchased 80.1% of Chrysler from Daimler, wants their money back. Cerberus says that Daimler gave misleading information about Chrysler during the sale. Cerberus has owned Chrysler for about a year and says that the company has had much higher losses than anticipated. Cerberus should know that after 30 days you can only get store credit.

"The claim is baseless and absurd," Daimler spokesman Han Tjan says. "Absolutely incorrect and completely without substance."

Chrysler was owned by Daimler, the parent company of Mercedes-Benz, for nine years. Daimler failed to turn the company around in that time and the sale to Cerberus was an attempt to cut their losses. Daimler saw significant losses when it sold Chrysler to Cerberus, about $650 million according to USA Today.

Daimler was trying to sell its 19.9% stake in Chrysler to Cerberus, but Cerberus’ buyer’s remorse has put a stop to that.

Maybe Chrysler’s customers should try the same argument. Their investments have depreciated a whole lot more than anticipated too.